Intel seeking to sell Web-based TV service OnCue

Bloomberg

Wed, Nov 27, 2013 - Page 15

Intel Corp is asking about US$500 million for OnCue, the online pay-TV service that the world’s largest chipmaker developed before dialing back its ambitions, people with knowledge of thematter said.

Intel is seeking to secure a sale by year-end, said the people, who asked not to be identified because the talks are private.

One suitor, Verizon Communications Inc, has begun talking with owners of broadcast and cable channels about terms for a streaming TV service, they said.

A sale that meets Intel’s asking price would let the company recoup its costs as it retreats on a plan to enter the pay-TV business, while still supplying chips to the new owner.

Samsung Electronics Co and Liberty Global also met with Intel, people said earlier. Intel’s TV efforts slowed under CEO Brian Krzanich, who took the reins in May and has focused on getting chips into mobile devices.

OnCue is able to provide pay-TV programming over any high-speed Internet connection, making it a threat to cable-TV services that deliver shows over dedicated lines installed by territory. Intel developed a system that includes servers, set- top boxes and applications that stream content to phones and tablets.

Verizon, one of the biggest US telephone and wireless operators, runs the FiOS fiber-optic pay-TV service that competes with cable companies. OnCue would let Verizon sell pay-TV outside the current FiOS footprint.

The company has been asking media companies if a streaming service would require new contracts for shows, or whether existing FiOS TV agreements could be amended to include the additional rights, the people said.